The owner of a harness-racing track in Floyd County has paid off a $2.2 million bond that had caused concern over the potential for county taxpayers to get stuck with the debt at a time when money is tight.
County officials and Murray Sinclaire, owner of Appalachian Racing Inc., confirmed the agreement, which ends any potential liability for the county.
“Everyone worked together to come to a good, favorable outcome,” county Judge-Executive Ben Hale said. “This was a major savings for the taxpayers of this county.”
Sinclaire said in a statement that financing on the Thunder Ridge facility had matured and “all investors received full principal and interest payments.”
The county underwrote a $2.7 million bond in the early 1990s to help build the harness track near Prestonsburg in hopes that the facility would create jobs.
There were efforts through much of the 1990s to expand casino gambling in Kentucky, creating the potential for a lucrative gaming site at the track. Those efforts never came to fruition and the track has struggled.
Appalachian Racing made all the required annual payments on the bond, Hale said.
However, there was a concern that if the company either couldn’t or wouldn’t make the payments at some point, the debt would fall on the county at a difficult time.
Local revenue from a tax on coal production has dropped sharply since 2011 because of a downturn in the industry, and the loss of jobs has hurt other businesses as well.
Floyd County Attorney Keith Bartley said the county should never have made the deal with the late Terrell Ross, co-founder of Ross, Sinclaire & Associates, a financial company that has set up many public bond deals in the state.
“The deal was a horrible deal for the county,” Bartley said, though there was a good resolution with Appalachian Racing paying off the remaining $2.2 million on the bond.
Ross died in 2006. Sinclaire, of Cincinnati, inherited Ross’ interest in Appalachian Racing.
The county owned 15 acres at the track that included the grandstand and parking lot. The county deeded that to Appalachian Racing in consideration for satisfying the bond.
Getting the bond off its balance sheet will help the county if it needs to finance other projects, Hale said.
Hale said Appalachian Racing hopes to sell its license and the land. The track, with 50 acres outside the floodplain and good road access, is a prime development site for Eastern Kentucky, local officials said.
Keeneland considered buying the Thunder Ridge license to cover a quarter-horse racing facility the Lexington track plans to build at Corbin, but a Keeneland official said earlier this year that plan had changed and the track would instead seek an open license for the Corbin facility.